TMI Blog2012 (5) TMI 154X X X X Extracts X X X X X X X X Extracts X X X X ..... granted by this Court on 25.11.2011, shall continue. Power of the courts in exceptional circumstances - held that:- The court may in such cases bend the rules of procedure if no specific provision of law or rule of fair play is violated for it would promote substantial justice provided that there is absence of other disentitling factors or just circumstances. - W.P.(MD) No.13516 of 2011 W.P.(MD) No.13517 of 2011 W.P.(MD) No.13518 of 2011 W.P.(MD) No.13815 of 2011 W.P.(MD) No.13816 of 2011 W.P.(MD) No.13817 of 2011 & W.P.(MD) No.13818 of 2011 - - - Dated:- 24-4-2012 - MR. JUSTICE V. DHANAPALAN, J. For Petitioner in all W.Ps. ... Mr.T.Mohan for Ms.D.Geetha For Respondent in all W.Ps. ... Mr.R.Aravindan COMMON ORDER The orders of the respondent, calling upon the petitioner, to make payment of the dues, and appropriating the sanctioned amount of rebate towards the outstanding arrears, are under challenge in these Writ Petitions. 2. Since all these Writ Petitions involve a common issue, they are being disposed of in common. For the sake of disposal, let me take the facts in W.P.No.13516 of 2011. (i) M/s.Madura Coats Pvt. Ltd., Madurai, the petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd stay. Though these stay orders had not been vacated and the appeals not taken up for hearing in June 2009, the Superintendent of Central Excise, City range, Madurai-II Division vide his communication bearing Ref.O.C.No.439/2010 dated 27.08.2010 called upon the petitioner to pay the duty demanded as the stay order had not been extended after the expiry of six months from the date of the order, which is, by virtue of the second proviso to Section 35C(2A) of the Central Excise Act, 1944, as reproduced below : "Provided further that if such appeal is not disposed of within the period specified in the first proviso, the stay order shall, on the expiry of that period, stand vacated." (v) In view of the above, the petitioner was constrained to move the CESTAT once again in Miscellaneous Petitions in the two Appeals and by an order dated 20.09.2010, the Tribunal in Misc. Order Nos.427 and 428 of 2010 granted extension of stay for a further period of six months. Again, on 05.04.2011, the Superintendent of Central Excise, City Range, Madurai-II issued a letter to the petitioner asking him to obtain extension of interim order or pay the demanded duty. Once again, the petitioner was c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applications before the Tribunal seeking extension of stay already granted on 09.05.2011, which were due to expire on 09.11.2011. But, these applications were also not taken up due to non-availability of the Bench. (ix) Apprehending that the authorities would once again threaten coercive action, the petitioner has also filed a letter on 04.11.2011 before the Superintendent of Central Excise, informing him of the filing of the applications before the Tribunal seeking extension of stay and explaining the failure to obtain extension due to reasons beyond its control. However, the Superintendent of Central Excise, vide his letter dated 08.11.2011 has written to the petitioner asking him to obtain an order of stay or pay the demanded sum. The petitioner responded to the said letter on 09.11.2011 asking the Superintendent of Central Excise to refrain from initiating any coercive measures to recover the demand till the disposal of the application for stay pending before the Tribunal. A copy of the same was marked to the respondent. (x) However, the respondent, by his letter dated 09.11.2011 wrote to the petitioner that he has to produce a copy of either the Tribunal's final order in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 20.09.2010 in the above two cases for six months or until the disposal of the appeals whichever was earlier. 3.2. M/s.MCPL have produced a copy of the Misc. Order No.220-221/2011 dated 09.05.2011 of CESTAT, South Zonal Bench at Chennai on 13.05.2011. The CESTAT has allowed the Misc. Applications filed by M/s.MCPL for extension of stay already granted vide Stay Order Nos.306/2009 and 31/2010 dated 20.04.2009 and 18.01.2010 respectively and granted extension by six months or until the disposal of the appeals whichever is earlier. The stay order granted by CESTAT has not been extended for further period and as per the terms of the order, the same stood vacated after expiry of six months period. As per the circular issued by the Central Board of Indirect Taxes, dated 26.05.2010, an opportunity was provided to the petitioner to seek extension of stay through the letter dated 09.11.2011. Since the petitioner could not produce any order for extension of stay, the respondent has passed separate orders for appropriating the rebate claims towards the payment of arrears. The said orders were passed by the respondent through Orders No.92/2011 dated 22.11.2011, No.93/2011 dated 23.11.2011, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial measures only through the Appellate forum. After passing of such orders, the respondent is not vested with powers to review his own orders. Hence, the amount appropriated by him cannot be refunded unless otherwise ordered by Appellate forums or Court. Accordingly, he prayed for dismissal of the Writ Petitions. 4. The only contention of the learned counsel for the petitioner is that the action of the respondent in appropriating the amounts due to the petitioner towards outstanding arrears and making further demand for payment of dues, which is the subject matter of appeals before CESTAT, Chennai, is arbitrary and illegal. In support of his case, he has relied on the following decisions : (i) 2005 (180) E.L.T. 434 (S.C.), Commissioner of Customs Central Excise, Ahmedabad vs. Kumar Cotton Mills Pvt. Ltd. : "5. During the pendency of the appeal before this court, the matter was referred to a Larger Bench of the Tribunal. The Larger Bench has by its decision reported in 2004 (169) ELT 267 upheld the view impugned in this case. The decision of the Larger Bench has not been challenged by the Department being of the view that repeated special leave petition raising the same ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action on the part of the respondents. Thus, the Commissioner is directed to return to the applicant the entire amount, which has been appropriated against sanctioned rebate claims without the authority of Law and in abuse of the powers." (iii) 2011 (273) E.L.T. 3 (S.C.), Ranbaxy Laboratories Ltd. vs. Union of India : "Section 11BB of the Act comes into play only after an order for refund has been made under Section 11B of the Act. Section 11BB of the Act lays down that in case any duty paid is found refundable and if the duty is not refunded within a period of three months from the date of receipt of the application to be submitted under sub-section (1) of Section 11B of the Act, then the applicant shall be paid interest at such rate, as may be fixed by the Central Government, on expiry of a period of three months from the date of receipt of the application. The explanation appearing below proviso to Section 11BB introduces a deeming fiction that where the order for refund of duty is not made by the Assistant Commissioner of Central Excise or Deputy Commissioner of Central Excise but by an Appellate Authority or the Court, then for the purpose of this Section the order made ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court. There cannot, in our opinion, be any doubt on the point that the extent of purity of the gypsum won by the appellant is a question of fact. It has also been brought to our notice that after the dismissal of the writ petition by the High Court, the appellant has filed a suit, in which he has agitated the same question which is the subject- matter of the writ petition. In our opinion, the appellant cannot pursue two parallel remedies in respect of the same matter at the same time." (ii) (2004) 7 SCC 166, S.J.S.Business Enterprises (P) Ltd. vs. State of Bihar and others : "14. Assuming that the explanation given by the appellant that the suit had been filed by one of the Directors of the Company without the knowledge of the Director who almost simultaneously approached the High Court under Article 226 is unbelievable (sic), the question still remains whether the filing of the suit can be said to be a fact material to the disposal of the writ petition on merits. We think not. The existence of an adequate or suitable alternative remedy available to a litigant is merely a factor which a court entertaining an application under Article 226 will consider for exercising ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laimed originally has, by reason of subsequent events, become inappropriate or cannot be granted; (ii) that taking note of such subsequent event or changed circumstances would shorten litigation and enable complete justice being done to the parties; and (iii) that such subsequent event is brought to the notice of the court promptly and in accordance with the rules of procedural law so that the opposite party is not taken by surprise. In Pasupuleti Venkateswarlu v. Motor General Traders1 this Court held that a fact arising after the lis, coming to the notice of the court and having a fundamental impact on the right to relief or the manner of moulding it and brought diligently to the notice of the court cannot be blinked at. The court may in such cases bend the rules of procedure if no specific provision of law or rule of fair play is violated for it would promote substantial justice provided that there is absence of other disentitling factors or just circumstances. The Court speaking through Krishna Iyer, J. affirmed the proposition that the court can, so long as the litigation pends, take note of updated facts to promote substantial justice. However, the Court cautioned: (i) the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t and title of the plaintiff. The doctrine itself is of an exceptional character only to be used in very special circumstances. It is all the more strictly applied in those cases where there is a judgment under appeal. His Lordship quoted the statement of law made by Sir Ashutosh Mookerjee, J. in a series of cases that merely because the plaintiff loses his title pendente lite is no reason for allowing his adversary to win if the corresponding right has not vested in the adversary but in a third party. In the case at hand, the defendant-appellant has simply stated the factum of proceedings initiated by HUDA against the plaintiff-respondent in an affidavit very casually filed by him. He has not even made a prayer to the court to take notice of such subsequent event and mould the relief accordingly, or to deny the relief to the plaintiff-respondent as allowed to him by the judgment under appeal, much less sought for an amendment of the pleadings. The subsequent event urged by the defendant-appellant is basically a factual event and cannot be taken cognizance of unless brought to the notice of the court in accordance with the established rules of procedure which if done would have aff ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal is already seized of the hearing. During the pendency of the appeal, any interference by the High Court in exercise of its writ jurisdiction was not called for as alternate efficacious remedy by way of appeal was available to the appellant." (vi) (2011) 4 SCC 266, B.Premanand and others vs. Mohan Koikal and others : "4. We have carefully perused the judgments of the Full Bench and the learned Single Judge, and we regret we cannot agree with them. The Full Bench and the Single Judge have relied on equity, justice and good conscience, rather than law. We are of the opinion that this approach is incorrect. When there is a conflict between law and equity, it is the law which is to prevail. Equity can only supplement the law when there is a gap in it, but it cannot supplant the law. ..." (vii) 2011-TIOL-800-HC-AP-ST, Sri Chaitanya Educational Committee, Poranki Krishna District vs. Commissioner of Customs Central Excise, Guntur anr.: "Section 87 of the Act in plain terms empowers the Central Excise Officer to proceed to recover the amount of demand by one or more modes mentioned therein. Section 87(c) empowers the Central Excise Officer to distrain any mova ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is absence of other disentitling factors or just circumstances. The Apex Court affirmed the proposition that the court can, so long as the litigation pends, take note of updated facts to promote substantial justice. However, the Court cautioned that (i) the event should be one as would stultify or render inept the decretal remedy, (ii) rules of procedure may be bent if no specific provision or fair play is violated and there is no other special circumstance repelling resort to that course in law or justice, (iii) such cognizance of subsequent events and developments should be cautious, and (iv) the rules of fairness to both sides should be scrupulously obeyed. 10. In the instant case, though the Tribunal was not even in session, by way of abundant caution, the petitioner has filed applications before the Tribunal seeking extension of stay already granted on 09.05.2011, which was due to expire on 09.11.2011, but, the said applications were not taken up due to non-availability of the Bench. Of course, on the expiry of stay, the respondent was empowered to act upon the impugned proceedings, but, at the same time, it was incumbent on his part to keep in mind the non-availabil ..... 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